As they struggle with dwindling revenue and profitability, telcos are looking to build new capabilities to capitalise on a massive blockchain opportunity, according to GlobalData.
However, they must adapt their networks and train personnel, ranging from the elimination of hated roaming fees to accelerating the broad availability of connected device services like drone deliveries.
Consulting stalwart Accenture sees the potential for a $1 trillion global telco blockchain ecosystem. Operators on a global scale are gearing up to capitalise on a variety of capabilities. Several of them are far along in testing the technology to address immediate opportunities such as eliminating widely loathed roaming fees.
Major operators such as BT, Colt, HGC Global, Telefonica and Telstra are already engaged in a high profile trial aimed at accelerating the settlement process of their wholesale services. Verizon is financially backing Filament with the goal of using blockchain to ease the use and payment of connected device services such as drone-based deliveries and monitoring.
Ron Westfall, Technology Analyst at GlobalData, says: “Through blockchain-enabled direct communications to mobile device SIM cards, mobile operators would love to offer their voice and data services to international travellers visiting in their coverage areas. The operators benefit by accessing a vast new customer base of travellers while also avoiding costly integration into third-party systems or spending heavily on upgrading inflexible legacy systems as well as building new complex systems.”
Immense ramifications
However, operators have traditionally struggled to sell anything beyond voice minutes and data bytes. Blockchain requires a level of technical know-how and marketing sophistication that will not come overnight.
Westfall concludes: “Telcos must show they can use these ongoing blockchain trials to quickly deliver new services and features. They need to hire and train personnel that understand blockchain technology and adapt their networks to take advantage of distributed ledger capabilities. The evidence indicates some operators will be ready to use blockchain-enabled capabilities like initiating the widespread elimination of roaming fees toward the end of 2018.”
“Longer term, and if done correctly, the ramifications for the telecom market are immense, as operators as well as their customers and partners stand to gain significant customer experience and financial gains from blockchain-powered, fully trusted and streamlined communications and transactions.”
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.